Water Insecurity

The BBC reported a story originally appearing in the publication Nature regarding the world's water supply. The gist of the article is that global fresh water supplies are dwindling at a troubling rate. The researchers wisely split their analysis into two gross categories: "natural" and "managed" water supplies. The latter refers to reservoirs and other human interventions to maintain sufficient potable water. The former considers streams and other conduits that have flowed unimpeded for centuries.

Interestingly, the developed nations in the Northern Hemisphere have stressed their aqueous natural resources. Their supportive infrastructure manages to supply enough water for their demanding industries and growing populations. Developing nations more or less face challenging conditions in which the deterioration of their water supply will only accelerate.

In recent years, some writers and financial analysts have characterized water as "blue gold." I entirely share that perspective. There is a finite -- and declining -- supply of fresh, potable water in the world. Global population is expanding. Demands on available water supplies will most likely increase to a grim extent. China, for example, is staring at some bleak social and economic consequences, thanks to its relentless degradation of its water resources.

One problem with taking water issues is that the northeastern United States, where many of the nation's leading thinkers and financiers are located, doesn't have an obvious water supply issue. This region has managed to dodge the nastier outcomes of drought -- so far. It has also done next to nothing to preserve arguably its most valuable commodity.

Curiously, the nation that best understands water management is France. There are a number of French firms specializing in this area. One can invest in some of them, either via ADRs or, if your portfolio structure and prosperity permit, purchase them directly from the Paris Bourse. You'll have to do your own homework on this topic. When you do, drink plenty of water -- while you still can.

The photograph shows Minnesota's Lake Itasca, the source of the Mississippi River.